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Court of Appeal Confirms (Again) that CEQA Statute of Limitations Runs from the First Project Approval

The Second District Court of Appeal confirmed again that the California Environmental Quality Act (CEQA) favors finality in rejecting a challenge to a subsequent project approval for a 42-single family home project in Los Angeles.

In Guerrero v. City of Los Angeles the Court of Appeal reversed a trial court judgment setting aside a mitigated negative declaration (MND) and requiring an Environmental Impact Report (EIR) for the project because petitioners did not sue within the 30 days after the Notice of Determination (NOD) for the MND and first project approval in 2020. Confirming long-standing law against re-opening CEQA for every subsequent action that implements a project, the Court held “later adoptions of the same MND cannot restart or retrigger a new limitations period.”

Background

As is not uncommon for many developments, the City’s approval of the project involved many steps and revisions of the project, during which the City filed numerous NODs. The City originally adopted the MND when the City’s Planning Department approved a vesting tentative tract map on March 3, 2020. On March 25, 2020, the City filed a NOD pursuant to CEQA Guidelines Section 15074. Then, in May 2020, the City’s Planning Commission approved various zoning determinations and adjustments for the project, and recommended the City Council adopt the zone change required for the project. A letter of determination was issued on January 14, 2021, and a second NOD was filed on February 4, 2021. On June 8, 2021, the City Council again adopted the MND, rezoned the site, and filed a third NOD on June 18, 2021. On July 16, 2021, Petitioners filed a challenge to the City Council’s 2021 project approvals.

Court of Appeal’s Findings

Petitioners claimed their CEQA claim was timely because it was filed within 30 days of the third NOD. The Court of Appeal disagreed finding “[i]t is the first approval that triggers the running of the statute of limitations, and later approvals do not restart the statute of limitations clock.” The Court based its decision on the following reasons:

  • Environmental Review Must Occur at Earliest Feasible Opportunity. The Court recognized that “[t]he mere possibility that a project may change as it moves through the planning process does not preclude applying CEQA’s requirements at the early stages of project review.” Here, the City properly conducted its environmental review before making any project approvals.
  • CEQA’s Statute of Limitations is Triggered by the First Project Approval, Even for Projects Subject to Numerous Discretionary Approvals. CEQA Guidelines, § 15378 further makes clear that a “project” subject to CEQA “refers to the activity which is being approved and which may be subject to several discretionary approvals by governmental agencies. The term ‘project’ does not mean each separate governmental approval.” As the Court noted, “the City made its earliest firm commitment to the Project when it approved the vesting tentative tract map, even though there were conditions attached to the approval,” and, thus, that was the proper “project approval” for triggering CEQA’s limitations periods.
  • The 30-Day Statute of Limitations Applies Where an NOD is Filed. For these reasons, “[t]he City’s March 25, 2020 NOD was effective to trigger a 30-day statute of limitations on any challenge to the validity of the MND.”
  • A New Statute of Limitations is Triggered Only Where Subsequent or Supplemental Review is Required. The Court also noted CEQA’s statutory presumption under Public Resources Code section 21166 against additional environmental review for implementing approvals, which is limited to where there are substantial project changes, new information or changed circumstances resulting in new or more severe impacts. The Court rejected Petitioners argument that this presumption did not apply the prior CEQA review as an MND. The Court noted the presumption still applied: “there have been no changes to the Project requiring a subsequent or supplemental MND, the later adoptions of the same MND cannot restart or retrigger a new limitations period.”

Conclusion

The key take away is that in multi-phase development projects, the first project approval in a series of discretionary project approvals for the same project always will trigger CEQA’s statute of limitations.

Once that limitations period has run, there can be no further CEQA compliance challenges to the project unless subsequent or supplemental review is triggered under Public Resources Code §21166. This is the same even when the project was originally approved based on a MND, rather than an EIR. To allow otherwise, reasoned the Court, would undermine the need for finality and predictability for land use decisions.